Forex Signals

The No-Stop, hedged, Forex trading Grid system ("the No Stop system")
is one of the most misunderstood techniques in forex trading. I am
going to describe the No Stop system as best I can in the limited space
available. There is a series of 7 other articles describing the
elements below in greater detail. There are many hedged systems around
and the No Stop system below is one that is being traded profitably.

The No Stop system is an investment technique which creates favourable
dollar cost averaging on all transactions entered into. For this reason
the technique is too much of a paradigm shift for most conventional
traders who like charts, support and resistance and indicators. It is
strictly speaking, it is not a trading technique. It has however become
very popular as a trading technique because of the short term gains
that can be made.

The No Stop system trades without stops. No stop loss orders are used
at all except for when a group of transactions have a positive result
and we want to liquidate the entire group of transactions at a net
gain. Because the No Stop system cashes in its transactions regularly
it becomes a trend following No Stop system too. There is no need for
charts when using this No Stop system as we use predetermined price
levels to cash in transactions positively (The No Stop system loves
price spikes).

Transactions can or should be slow at a rate of about 3 to 4 a week. As
price levels are determined well in advance orders can be placed well
in advance so the No Stop system takes very little supervision. The
technique is highly systematic and can easy be converted into an
automatic trading system or expert advisor very easily.

The No Stop system is always in a sell and a buy at the same time and
therefore can cash in on any move the market makes. Being in a sell and
a buy at the same time also created a hedge. Predetermined cash in
levels create a grid of price levels there positive transactions will
be cashed in continuously until the group of transactions are
profitable.

In simple terms you will enter the market at a particular level with an
active bay and a sell. You would have predetermined levels at which you
would cash in positive transactions. For instance one could decide to
cash in on every 100pip (grid gap) move made in the market. When the
price moves 100 pips you would cash in your positive transaction and
then enter into another buy and sell transaction at that point. This
process will continue until the total for the group of transaction is
positive and then you would liquidate. You would then start again - as
simple as that. Money is made when the price revisits some of the cash
in levels over and over and over again (which it does). In the above
example should the price return to the starting level (after moving 100
pips) the group of 4 transactions in total will be positive and you
would then cash in the unwanted transactions, bank your profits and
start again.

The big danger of this No Stop system is strong trends with no or very
few retracements. You will lose money in trends. There are however
specific techniques to manage and contain these losses. The biggest one
is to start with a big grid gap. What is a trend on a 5 minute chart
could be a small spike on a daily or weekly chart. Grid gaps of between
150 pips and 300 pips have been found to work well. One could also vary
the grid sizes relative to the trend to reduce the number of unhedged
transaction. For example have grid gaps of 100, 200, 300 etc. The other
way is to vary the number of lots used when entering into the buy and
sell transactions at a particular cash in point to ensure balanced
hedging.

Trends tend to scare people away from this technique but if one views
this as an investment technique and not a trading technique the trends
could have a reduced impact on the annual return on investment. The
market only trends 20% of the time any way. Talking about return on
investment some current trading groups are showing returns of between
200% p.a. and 1000% p.a. on current investment levels. There are many
trading records are available to back this up. The longer you trade
this No Stop system the lower your risk and the better your return.
That said, you can lose more than just your boots (your whole trading
account) if you treat this No Stop system with disrespect.

In very simple terms you will start trading this technique by entering
the market at a particular level with an active bay and a sell. You
would have predetermined levels at which you would cash in positive
transactions. For instance one could decide to cash in on every 100pip
(grid gap) move made in the market. When the price moves 100 pips you
would cash in your positive transaction and then enter into another buy
and sell transaction at that point. This process will continue until
the total for the group of transaction is cashed in positively. You
would then start again - as simple as that. No need for charts.
Patience is the biggest virtue required.

Success factors for this No Stop system are: - Selecting appropriate
grid sizes, currency pairs, lot sizes, cash in times and an investment
mentality. All very easy, if you have done it for a few years. This No
Stop system is not for everybody however, and is not the best Forex
system since sliced bread, but is does very nicely for some traders,
thank you very much. It is important to know about this system as using
its principles could help your conventional trading.

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